Hearing from the perspective in the Indian Ocean, Sri Lankan ambassador describing the “Belt and Road initiative”

Q: First of all, thank you for joining us for this interior and agreeing to share insights. Would you prefer to start by telling us about yourself and your work, then we can continue.

Ambassador: It has been about 20 months since I became Ambassador of Sri Lanka in China. Prior to that, I was Sri Lanka’s permanent representative to the United Nations in New York with the rank of ambassador. Before that, I was Sri Lanka’s Foreign Secretary. I can go on and on. I think that’s the price at the moment.

Q: What do you think of China’s current diplomatic and economic relations with Sri Lanka?

A: The relationships are very good, very warm, and very close. The two countries are enjoying a very fruitful and very productive relationship at the moment. Sri Lanka has had a very long and close relationship with China, extending over 2000 years. In more recent times, Sri Lanka was one of the countries that engaged with China economically since we entered into what is known as the Rubberized Agreement, under which we agreed to sell rubber to China in exchange for rights. That agreement was active until about the early 1980s. Sri Lanka also was one of the most vocal champions of China resuming its seat at the United Nations. In more recent times, China unequivocally supported Sri Lanka in its struggle against the separatist terrorist LTTE and again extended diplomatic support to Sri Lanka at the international border. China was the country that supplied us with Covid-19 vaccines in 2021, at the time when the epidemic was threatening to spin out of control in Sri Lanka, and also when other countries were either incapable or were reluctant to provide vaccines to Sri Lanka. In fact, it could be said quite honestly that today Sri Lanka has the epidemic very much under control, largely due to the 26 million doses of vaccine supplied by China, 3 million of which were provided as a gift.

Today, Sri Lanka has opened its borders, and visitors are coming. If they are vaccinated, they can enter the country without any restrictions. And as a result, tourism, which was a major player in our economy, is beginning to revive. So I think on the whole, the relationship between the two countries is very good. China also extended an emergency aid package earlier this year when Sri Lanka was confronted with an unprecedented financial crisis, largely catalysed by the Covid 19 pandemic.

Q: Thank you. And for our second question, what were the main advantages and disadvantages that you have perceived in the Sri Lankan’s BRI project?

A:As soon as the BRI was launched in 2014 by President Xi Jinping, it was, and we said that something between 4 trillion and $8 trillion will be invested in the wider region. Sri Lanka welcomed the BRI at the highest levels and we continue to embrace it. As a result of BRI funding, we have the Columbia Port city, now reclaimed from Sea Hambantota Port and adjoining industrial zone highways which have made a massive difference to transportation within the country. Just to give you an example, prior to the construction of Columbus Gold Highway that journey used to take 5 hours. But now the same journey could be undertaken within 70 minutes. It made a huge difference. Similarly, central highways and others are being constructed, water projects, electricity projects, etc. The BRI funding has made a significant impact on the economic, social and cultural life of the people. As we all know, the BRI funding in the region also is beginning to make a big difference in Africa in particular and in our own region. So I would say that the BRI has made a big difference and we’ll continue to make a big difference between Sri Lanka.

Q:And what do you think are the main differences between the BRI funding and the IMF funding?

A:The most significant difference is that BRI comes with no conditions. There is no condition attached to the BRI, while IMF always has conditions attached, sometimes these conditions have very little to do with the funding they seep across the spectrum of human activity. And this is one of the reasons why Sri Lanka had been reluctant in the past to actually activate its IMF relationship. However, this time we had no choice. We are going to get diabetes and we probably may be given a dose of medicine that will be difficult for us to digest. But this was an exceptional situation. On the other hand, BRI funding has increasingly become more sensitive to the cultural needs of the people, the social needs of the people, and also the environmental needs of humanity as a whole. Now, the funding is not necessarily directed towards development alone, but also towards conservation. So I believe that in the long run the BRI will be very beneficial to us. That is not to say that we could ignore them. There are times like now Syria has been compelled to seek IMF assistance and hope that IMF assistance will not result in too much difficulty for the common persons in Sri Lanka. 

Q: In recent years, as you know, many Western countries use Sri Lanka’s risk and economic problems to undermine the usefulness of BRI. How would Your Excellency prefer to respond to these claims?

A: I have read these comments coming from the west and I have responded to these comments also. Sri Lanka benefited from the BRI funding, and there’s no doubt about that. Sri Lanka did not go looking for BRI funding. On the other hand, let me phrase myself differently. Sri Lanka went for BRI funding because there were certain urgent requirements for the development of the country. This is not decided on willy-nilly. We had a 27-year-long terrorist problem in the country. When the terrorist problem ended, there was an urgent need for quick reconstruction and development. We approached many of our traditional funders and we did not receive any joy from them. Then we approached China and via and as I said earlier today we have very impressive highways to show for it harbors, airports, etc. China did not come to Sri Lanka with the arrival. In fact, it took considerable negotiation to persuade China at the time to extend financial assistance for our development needs. So some of the commentary that is coming out of the west and really not consistent with what really happened at the time.

Q: What does the Sri Lankan government think about the current situation with the Hambantota port project? Does the Sri Lankan government perceive it as a successful development, and if so, why?

A: See, Han was intended to be a port to serve the main shipping route linking the Middle East and East Asia. And it’s only 20 km away from that shipping. Of course, like any major project of this nature, you can’t expect very full returns overnight. It takes time. The users have to get used to the idea of the port being there, and then it will become more popular among them. And over the last three or four years, the number of ships using the hamburger port has increased. Now there’s a bunkering facility available and it is doing good business, a private sector company, and it’s doing good business. And I have no doubt that over the years, Hambantota will become a major midway port for ships flying across the Indian Ocean from Swiss Kandang and the Middle East towards East Asia. You have to remember that 60% of the energy needs of East Asia is carried past Sri Lanka. So the very fact that this port is there will be an incentive for some of those ships to make use of in the same way Sri Lanka is today the main breakup port for the subcontinent.

Large ships come to Sri Lanka, to Kalamu, and increasingly to hang on. They will discourage the loads into smaller ships to be carried to the subcontinent. Similarly, smaller ships from the subcontinent will continue to come to Sri Lanka to make use of the bigger vessels that fly between East Asia and the Middle East through to Europe. Today, Hambantota has become a major port for the distribution of elsewhere and being distributed in the subcontinent and also subcontinental cars being brought to hamburger to be reshaped on larger ships to distant usage. Although that’s only an example used by motor car manufacturers off the port of hamburger. In the future, we can imagine others will also use that port in the same way. And I don’t think two commercial companies that lease the port would have entered this venture if they knew that it was not going to produce returns for them. Already the returns are there. In fact, there are commentators in Sri Lanka who would say that even if we had not leased harbor at the time, we could have benefited from the increased usage that is being made of the port. So, on the whole, I personally think America will be a very lucrative commercial proposition in the years to come. It’s a pity that Sri Lanka will not be making use of that.

Q: And with the economic growth rates of China post covid crisis, do you think that the future BRI projects are likely to happen in Sri Lanka, or do you think that it’s not more likely in the future?

A: It’s true that the growth rate of China has slowed down. And I don’t think China was actually relying on its growth rate to fund BRI projects. Perhaps some projects might be delayed or shut because of slowing off the growth rate. But at the time when the BRI was launched, it was going to rely on China’s massive stock of reserves. It still has. And the amount that will be invested may be different from the originally envisaged four to $8 trillion, but it certainly is going to be a significant amount, significant enough to make a big difference for the developing countries of the wider region. And these countries were yearning for funding, for their development, and that yearning was never satisfied by the traditional funders. And when China comes along with its massive reserve of resources, financial resources, and offers the BRI to the developing world, not only in the Afro Asian region, but even beyond, countries jump to it, because earlier the needs were there. Their needs were very apparent, especially in Africa or in South Asia. But these needs were not met. Our massive conditionality was attached to those who were lending to satisfy some of these needs.

Now we have a funding source which will meet most of the needs of these countries, whether it’s roads, bridges, harbors, mining complexes, etc. So I think the slowing down of the Chinese growth rate will be a factor we’ll have to keep in mind for the future. But then China was never going to rely on its continued growth rate for funding Vienna. And already many countries in Central Asia and Eastern Europe have linked up with China and have used VRI funding for their infrastructure development programs. We now have the China Europe Railway, which flies between the two destinations. Both ways are carrying manufactured dudes plus consumables both ways. And there are literally hundreds of journeys being taken every month, and there are various hubs from which the trains leave China. So things are happening despite the slowdown of the Chinese economy.

Q: As you know, there have been a lot of claims in the west naming BRI as a debt trap using Sri Lanka examples. And how would you like to respond to these claims?

A: I said this before; I think it’s unfair and mischievous to use Sri Lanka as an example of a debt trap. Less than 10% of Sri Lankas, their external debt is owed to China. They owe a similar proportion to other countries like Japan. And the vast majority of our debt is owed to multilateral institutions, double bank ADB, et cetera, and institutional investors. So 90% of our debt is owed not to China, but to other entities. So if there ever were a debt trap, and I don’t think there was a debt trap, it’s owed to Wall Street, not to China. China owes only about 10% of our external debt. And when China extended its funding to Sri Lanka, it was usually at a concessional rate. The interest rates are much lower than the commercial rates. And then, of course, the maturity periods were also much more favorable. So to suggest that the lending from China suddenly became a debt trap, I think it’s a misplaced allegation and I think it’s a different version of being mischievous.

I’m not relying on propaganda for what I’m saying. I’m relying on facts. While the term debt trap itself is convenient propaganda.

Q: Yeah. To be totally honest, we don’t hear this view at all in the west. I haven’t been I can’t recall any newspaper that I’ve read. That’s why we’re actually having this interview to begin with, to be honest. Thank you for the next question. What’s the current public opinion? In Sri Lanka, regarding the agreement to give Hambantota port projects for 99 years to China, a Chinese merchant port holding company limited for 1.12 billion.

A: As I said, there are many people in Sri Lanka who think that justifiably there was no need to at least the port to China merchants. And also now the newly constituted Hambantota International Port, of which Sri Lanka still holds a significant percentage of shares. But it’s a done deal now. It’s a contract that we signed, so we need to make the best of it. Let’s see what will happen in the future. But let me say that Sri Lanka has always honored his contractual obligations. I don’t hear any discussion in the country which suggests anything otherwise.

Q: Thank you. And maybe, as you have also heard, that in the Western economic world, there has been some debates about whether China will use Hambantota ports in military usage. Could you comment on that?

A:I don’t want to use too desperate a comment to describe the allegation, but China has never said that it wants to use it as a military facility. And Sri Lanka went through 27 years of brutal conflict to prevent a separatist group from breaking away. And we are not going to be in a hurry to give away a part of our territory to anybody to be used as a military facility. Sri Lanka will not do that. It will not even encounter that possibility. So let me say that China is never asked to use somebody that has a military facility. And I find that an incredibly difficult suggestion to absorb because China doesn’t have the military muscle in the Indian Ocean to counter India or the United States. India is a power to be reckoned with in the Indian Ocean. Just by using Ambassador. It’s not going to make a big difference to the current situation. And then, just 400 kilometres south of Sri Lanka is Diego Garcia. It’s either the biggest or one of the biggest in the US. Military bases in the world. But I think it’s ridiculous to suggest that China is going to make a big difference to itself by using Hambantota.

A: In fact, I can’t even imagine what it would want to use Hambantota for. So I paid no attention to this allegation. I think it should be dismissed with no attention at all.

Q: All right, thank you. And do you think that there was any relation between the BRI Projects and the corruption cases surrounding them?

A: People have been saying that, but it’s easy to demonise someone or ruin their reputation through allegations until there is evidence to justify the allegation. We should treat an allegation just as it is. You cannot convict anybody with allegations. You need verifiable facts and evidence. So I think we should just leave it at that. These are allegations and nothing more.

Q: How do you think that the riots in Sri Lanka will affect the relationship with China?

A: Again, I wouldn’t describe them as riots as such. We have seen riots elsewhere in the world, everywhere, whether it’s Paris or LA. There have been riots. But in Sri Lanka they were for a long time peaceful demonstrations, and we encouraged them. We did not attempt to stifle those demonstrations. These were demonstrations staged by people who were hurting due to shortage of fuel, electricity, food, medicine, etc, etc. Then, for some reason, at some point, the demonstrations were taken over by certain groups who claimed the presidential secretary was taken over, and the president’s House was taken over. And today all that has been contained. The country is rapidly returning to normalcy, and in the process, not one single foreign oversight, not one single foreign investment was attacked, and that includes the Chinese. No Chinese person was armed. No Chinese investment established was attacked. So the demonstrations themselves have not caused any difficulty for the relations between the two countries. And the new authorities have established very close links with China very quickly. And I think, although there was some uncertainty at some stage, now the country is returning to normalcy and our traditional relationships are being nurtured in the same way we value those relationships, especially our relationship with China, and it will progress without any hints. That’s my view.

Q: Thank you. And as you know, the US and the European countries recently have been trying to counter China’s growing influence in the world by creating new funds such as Build Back Better. And do you think that there’s a chance for Sri Lanka to get closer with Western powers regarding these new funds?

A: I think it’s very disappointing that these countries, the US and European countries, waited till China came up with BRI to come up with a concept like Build Back Better. It should have been there before many of those European countries enriched themselves with the colonies. The colonies suffered as they enriched themselves at the expense of the colonies. These programs should have been launched much earlier without waiting for China to come up with the BRI. So if they are at least now entering the development race or the race to assist developing countries to get ahead in the world, I think it’s a good thing. But I personally don’t think trying to compete with China is going to be of much value to anybody. It’s not through competition with China or that should not be the motivation for helping developing countries get ahead. Developing countries should be assisted because they should be assisted, not because China is already there helping them. It’s disappointing, very frankly, that these countries have waited till China started helping countries to enter the process of helping poor countries. They should have done this much earlier and they owed it to the developing world to do this, but didn’t instead wait until China came in.

And now commentators are saying that this is to counter China. China is helping developing countries to do better, to get ahead, to improve the lives of their people, to improve their economies. Why is there a need to counter that? It’s a very good thing that they’re doing. If the developed west wants to do something, they should do it because they want to help the poor countries, not because they wish to counter China. I think the purpose behind saying, if that is the purpose, to build back better is to counter China. I think that is very misguided. I would hope that building back better is an effort to help poor countries to improve their lives, improve the lives of their people, improve their economies and make those countries help those countries stand up on their own feet. It should not be an effort on the part of the developed west to counter China. I hope not, because there’s no need to counter China. China is doing something good while China is doing what it can. These other countries also should do more. They should have been doing more earlier, long before this, without waiting for China to start doing it.

A: So I think my short answer to your question is that Sri Lanka is not going to get involved in this game. For Sri Lanka, what is important is development for its own sake. Sri Lanka needs a better life for its people. It needs to be able to stand up in the world on its own feet. And if China is doing it, we are grateful for that. And if everybody else wants to do it and they want this something they should have done much earlier, even now it’s not too late. We would like them to step in and help my country realize its own potential. One thing that’s been happening in the past is a constant barrage of advice on what we should be doing. What we need is more than advice. We need tangible assistance.

Q: Are there any plans for Sri Lanka to spark space in the regional comparison economic partnership in any near future?

A: We have already applied to upgrade our membership, our participation rather than membership. You’re not a member and we hope that sooner than later our request will be granted.

Q: Thank you, and we have only five minutes left. So I’ll try to go with one last question as well. How do you think that the current regional power struggle in the notion will affect you?

A: Power struggle, I think, exists in the minds of certain individuals and certain commentators. I do not see and I’m here in Beijing, I talk to a lot of people, I read a lot of material. I do not see China wanting to participate in a power struggle. And then we hope that that will not be the case. In Asia. We were left behind by the Western world as it surged ahead, and for a long time we were exploited as colonized countries. We never had a chance to do well on our own. Right now, there’s no need to create a situation like the Cold War when we made the pawns of somebody else’s game. Asian, African and Latin American countries would wish to develop because it is what they deserve. Their people deserve that. They deserve a future where they’re not somebody else’s fault. So I think to characterize what is happening in Asia as a power struggle, I think the only feeding to this commentary, which has received a certain degree of appeal in the West, I think we need to get away from this commentary. Asia and Asian countries should be encouraged to help to develop and start up on their own right, on their own feet, rather than be just appendages in somebody else’s ambitions for global power.

Q: Thank you, Mr. Ambassador, for all your insights and for explaining to us your country’s perspective on this. Quite interesting questions, as our time seems to be nearly up. So I’ll just finish it by saying thank you for giving us your time and your insights and everything.

Interviewer: Baran. A

Text: Leo, Xin

Editor: Xin



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